Labor law specifies the responsibilities and rights of employers and employees. Fair recruitment practices comprise the first step in protecting employee rights. Labor law seeks mainly to address the imbalance in bargaining power between the employers and the workers.
Some of the safety nets available to job applicants include immunity from credit or background checks by employers without prior permission in writing. Employers are also prohibited from discriminating against applicants based on their religion, race, age, gender, or country of origin. Applicants with disabilities are also protected from discrimination. Furthermore, employees are granted a right to privacy when it comes to possessions on the job, as well as phone calls and voicemails. Communications made on company-owned equipment, however, may not be safeguarded.
Certain jurisdictions have also been exploring laws guaranteeing employees a right to disconnect, under which the employers cannot penalize employees for not responding to communications once office hours are over.
Need for Strong Labor Laws
Labor law is an instrument that promotes both worker empowerment and protection. It regulates individual as well as group employment relationships.
Labor law helps to balance the power equation between the employee and the employer, prohibits the employer from dismissing a worker without a strong basis, and establishes and maintains mechanisms that recognize workers as equal players in negotiations related to working conditions, wages, and so on.
Labor law also governs the labor market, and a government may opt to enact legislation setting floors and ceilings in relation to working hours or wages, either nationally or in specific industries or sectors.
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Who Enforces Labor Laws in the US?
The Department of Labor (DOL) in the United States is responsible for enforcing and administering more than 180 federal statutes. These directives, as well as the regulations, cover 10 million workplaces and around 150 million workers.
The Wage and Hour Division of the DOL investigates labor law infractions under the Fair Labor Standards Act (FLSA). The Wage and Hour Division administers several other pieces of legislation like the FMLA, Employee Polygraph Protection Act, Migrant and Seasonal Agricultural Worker Protection Act, and Consumer Credit Protection Act.
It also administers and enforces Acts that guarantee wage, hour, health, and safety benefits to those receiving government contracts, financial aid, or grants. These laws are the Davis-Bacon Act, McNamara-O'Hara Service Contract Act, and Walsh-Healey Public Contracts Act. The Wage and Hour Division also enforces the labor standards safety nets of the H-2A program.
The Office of Workers' Compensation Programs (OWCP) of the DOL administers the Longshore and Harbor Workers' Compensation Act.
The Federal Employees' Compensation Act (FECA) is also administered by the OWCP. The OWCP, however, has no role in the oversight or administration of workers' compensation programs in the states.
The Office of Labor Management Standards, which is another agency under the DOL, is in charge of administering the Labor Management Reporting and Disclosure Act.
The Occupational Safety and Health Administration (OSHA) manages the Occupational Safety and Health (OSH) Act. The Office of Federal Contract Compliance Programs oversees and enforces three contract-based federal civil rights statutes that call for equal employment opportunities to be provided by the majority of federal contractors and subcontractors, apart from federally-aided construction contractors.
Whistleblower protections are enforced by OSHA in most laws. Farm operations may also be subject to OSHA's health and safety rules. The OSHA also sets health and safety norms for the construction sector, and issues and enforces health and safety standards for the longshoring and maritime industry.
The Federal Mine Safety and Health Act of 1977 is administered by the Mine Safety and Health Administration (MSHA).
Major Labor Laws in US
Here are some of the major labor laws in the US arranged according to the broad subjects they cover-
1. Hours and Wages
The FLSA establishes salary and overtime pay standards that apply to most public and private sector jobs. The US Department of Labor's Wage and Hour Division is in charge of enforcing the FLSA. The Act mandates that companies pay at least the federally-fixed minimum wage to workers. It also envisages one-and-a-half times the ordinary rate of pay for overtime work.
It limits the duration that children younger than 16 years can work in nonagricultural enterprises, and prohibits the employment of minors under the age of 18 in certain jobs that are regarded as excessively dangerous. The Act also forbids employing children under 16 in agricultural work during school hours and in certain hazardous occupations.
Minors' educational possibilities are preserved while also prohibiting them from working in jobs that are harmful to their well-being.
The FLSA regulates minimum wages, overtime compensation, recordkeeping, and youth employment for workers in the private sector and those working under the local, state, and federal governments. Since July 24, 2009, the minimum wage of workers has been fixed at $7.25 per hour.
In the case of tipped employees, or those usually earning more than $30 every month in tips, the FLSA fixes the minimum cash wage at $2.13 per hour and the tip credit ceiling at $5.12 an hour. The two components add up to the minimum wage of $7.25. However, the actual cash wages and total wages earned by the employees and the tip credit vary from state to state. When an employee is covered by both federal and state minimum wage rules, he/she is entitled to a wage that is higher.
Only eight out of the 50 US states as of January 2018 made it necessary for businesses to pay their tipped employees the entire state-mandated minimum wage, Software Advice pointed out. In most of the restaurants in the US that paid their workers significantly less than the federally-determined minimum wage, the workers looked to make up the difference through tips.
If an employee's cash compensation and tips together don't add up to the FLSA-mandated minimum wage, the employer is made responsible for making up the shortfall. Although the FLSA allows for a maximum tip credit of $5.12 per hour, tip credit is not allowed in the states of California, Montana, Alaska, Minnesota, Nevada, Oregon, and Washington. Employees in these states are permitted to earn only tips and cash wages.
Employees who are eligible for overtime pay must be paid at least one and a half times their regular rate of pay for work done above 40 hours per workweek (regularly recurring and fixed period of 168 hours seven consecutive periods of 24 hours). Employees aged 16 years and above are not restricted by the hours they can work in a given workweek. On holidays, weekends, or usual days of rest, overtime pay is not required unless the employees work overtime on those days.
As far as recordkeeping is concerned, employers must hold pay and time records of the employees and must put up an official poster that outlines the FLSA requirements.
The Wage and Hour Division also administers the labor standards rules of the Immigration and Nationality Act. These rules apply to foreigners authorized to work in the United States under various non-immigrant visa programs like H-1B, H-1B1, H-1C, and H2A.
2. Workplace Health and Safety
As mentioned in one of the preceding sections, the Occupational Safety and Health Administration (OSHA) is in charge of enforcing the Occupational Safety and Health (OSH) Act. The OSH Act or state programs approved by the OSHA control health and safety conditions in a majority of the private enterprises. These programs also relate to the public sector. OSHA's health and safety standards and regulations must be followed by employers covered by the OSH Act.
The Act mandates that companies keep their workplaces free of hazards. Employees have a right to know about the hazards of their jobs, a right to submit OSH Act complaints about controlling hazards at the workplace, and a right against penalization for working according to OSH Act safeguards.
3. Compensation for Employees
The Longshore and Harbor Workers' Compensation Act provides medical care and compensation to certain maritime employees including longshore workers and other people involved in longshore operations, as well as harbor workers like ship repairers, shipbuilders, and shipbreakers, and dependent survivors of employees disabled or killed as a result of injuries sustained in navigable waters, or in adjoining spaces that are used in unloading, loading, fixing, or manufacturing vessels.
The Energy Employees Occupational Illness Compensation Program Act provides $150,000 as a lump-sum payment apart from prospective medical benefits to workers (and some of their survivors) of the Department of Energy and its contractors/subcontractors in the case of cancer caused by exposure to radiation, or as a result of illnesses resulting from exposure to silica or beryllium. It also offers a lump-sum payment of $50,000 apart from prospective medical benefits to uranium workers (or some of their survivors) who are deemed by the Department of Justice to qualify for compensation under the Radiation Exposure Compensation Act.
The Federal Employees' Compensation Act (FECA) creates an exclusive and comprehensive scheme for workers that pays compensation for a federal employee's death or disability caused by a personal injury received while on duty. FECA covers wage loss compensation benefits for partial or total disability, vocational rehabilitation, and medical expenses.
The Black Lung Benefits Act gives medical benefits and monthly financial payments to coal miners who are totally incapacitated as a result of pneumoconiosis, or black lung disease, contracted while working in coal mines. If a miner's death was caused by black lung disease, monthly benefits are to be provided to the miner's survivors.
4. Security of Employee Benefits
Employers who provide welfare benefits or pension programs for their employees are governed by the Employee Retirement Income Security Act (ERISA). The Employee Benefits Security Administration (EBSA) administers Title 1 of the ERISA.
Under this scheme, a wide array of disclosure, fiduciary, and reporting responsibilities are imposed on fiduciaries of welfare benefit plans and pensions, as well as those who engage with these plans. Many state laws are preempted by these clauses.
Certain plan administrators and employers are required to finance an insurance scheme to preserve certain types of retirement benefits under Title 4 of the ERISA, with premiums given to the Pension Benefit Guaranty Corporation of the federal government.
The EBSA also oversees reporting requirements to continue the provisions of healthcare that are required under the Comprehensive Omnibus Budget Reconciliation Act of 1985 (COBRA) and the requirements of healthcare portability under the Health Insurance Portability and Accountability Act (HIPAA).
Workers had virtually little right to organize in the 1930s when the Norris-LaGuardia Act was passed. Injunctions preventing strikes and picketing by employees were commonly issued by courts. These could be imposed solely based on the employer's testimony. Workers who refused to cooperate were imprisoned without a trial and fined.
The Norris-LaGuardia Act ensured that workers' right to strike was preserved. It made it illegal for courts to interfere with a worker's freedom to strike, form a union, help someone else in a labor dispute, peaceably assemble, and peacefully picket. The Act held that under the conditions of modern capitalism, "the individual unorganized worker is commonly helpless to exercise actual liberty".
The Landrum-Griffin Act, or the Labor Management Reporting and Disclosure Act, 1959 governs the interactions between unions and their members. It protects the funds of the union and facilitates union democracy by mandating labor bodies to file annual financial reports; requiring employers, labor consultants, and union leaders to submit reports on specific labor relation practices; and defining rules for electing union office-bearers.
The National Labor Relations Act (NLRA) regulates labor relationship rules in the private sector. Employees have the right to self-organize, form or join labor bodies, and bargain in a collective manner under the NLRA. The NLRA also puts limitations on how employers can deal with these rights. It forbids company-led unions and seeks to prevent discrimination against workers engaging in collective bargaining. If a worker's rights are violated, he/she can lodge a complaint with a regional National Labor Relations Board office within six months.
The Taft-Hartley Act amends the NLRA. The amendments, passed in a postwar context, were meant to prohibit unions from engaging in unfair labor practices. The secondary boycott and right to work provisions are two key sections that are often seen as anti-labor.
Boycotting someone else's company management is known as a secondary boycott. This is prohibited by the Act, which means that a union member is not allowed to picket the employer of another worker. The right to work provision empowers state legislatures to prohibit union shops, which means that new employees cannot be forced to join a union within a set period of time.
6. Protection of Employees
Whistleblower protections are required by most labor and public safety laws, as well as many environmental regulations, for employees who report their employers' infractions of the law. Resumption of employment and back wage payment are examples of possible remedies. Whistleblower protections are enforced by OSHA in most states.
Employers must not refuse to hire or to discharge any individual, or otherwise to discriminate against any individual with respect to his(or her) compensation, terms, condition, or privileges of employment, because of such individual's race, color, religion, sex, or national origin, says Title 7 of the Civil Rights Act.
The Age Discrimination in Employment Act (ADEA) forbids discrimination in the workplace against those aged 40 and above. Also, employers cannot refuse to refer a candidate for a job on the basis of age. The ADEA also prohibits unions to discriminate against members on the pretext of age.
The Family and Medical Leave Act (FMLA) allows employees to take unpaid leaves for medical or family reasons without risking their jobs or health insurance. Organizations with 50 or more workers must allow their employees 12 workweeks of unpaid leave after childbirth, to care for a child, spouse, or parent with a severe ailment, or if a major health condition stops them from doing their job satisfactorily.
Section 503 of the Rehabilitation Act, and the Vietnam Era Veterans' Readjustment Assistance Act, were both issued by the DOL's Office of Federal Compliance Programs in 2013. These laws are designed to safeguard veterans and those with disabilities.
Under the Employee Polygraph Protection Act, employers are prohibited from using lie detector tests on their staff, though polygraph tests are permitted on specific occasions.
The Uniformed Services Employment and Reemployment Rights Act gives certain armed forces personnel a right to be reemployed by the organization that they were a part of while entering service.
The Consumer Credit Protection Act regulates the garnishment of wages of the workers by employers.
Examples of Labor Law Violation
1. Paying less than the minimum wage- Employers are required to pay a federal minimum wage of $7.25 per hour worked. If they don't, they have to refund what they owe their workers along with interest. The employers would also have to make sure that such infractions don't recur. There may also be additional audits by the DOL.
2. Paying no overtime- If an employer does not pay workers one and a half times their normal wage rate for work done above 40 hours in a week, it would qualify as an infraction of overtime laws. However, salaried employees who get $684 per week at the minimum, or those doing managerial, administrative, or executive functions are not eligible for overtime pay.
3. Sacking employees without giving proper notice- Even if employees are asked to leave, they must be provided proper notice so that they can find another job, and their means of sustenance are not put in jeopardy. Depending on how long the employee has been with the organization, the notice period can range from a few days to a few weeks. Terminating employees without providing them adequate notice would subject the employer to fines. The employee may also have to be reinstated.
4. Maintaining incorrect records- As previously mentioned, keeping correct employment records is mandated by law. This covers elements like time tracking and wage data, among other things. Fines may be imposed on an organization if it is found to keep inaccurate records.
5. Discrimination in the workplace- Discrimination against employees on the basis of color, race, religion, gender, nationality, disability, or age is banned. An organization would face severe consequences if it is found to be discriminating against employees.
These are only some of the numerous possible labor law breaches. One should examine state labor laws to determine the specific penalties that apply in specific locations.
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Consequences of Labor Law Violation
1. On hours and wages- Employees may complain to the Wage and Hour Division if they think their organization isn't providing the federally-fixed minimum wage or giving overtime compensation.
The DOL will initiate an investigation if it receives an employee complaint. The organization's recordkeeping processes, pay and time records for all employees, and employee classification will be scrutinized by the investigators. Fines will be imposed if the organization is found guilty of violating laws. The highest civil monetary fines for willful or repeated contravention of the law are listed hereunder-
Minimum wage related offenses- $2,074
Overtime offenses- $2,074
Employee misclassification offenses- $1,000
Recordkeeping offenses- $1,084
These civil penalties apply to each case. Therefore, an organization that willfully violates minimum wage rules, will be fined for each employee. Employees who did not get the money they are entitled to may ask for back pay.
For example, the owner of a beauty salon in Florida had to shell out $53,841 in back pay after a recent probe revealed that overtime rules were not adhered to.
2. On child labor- The sanctions for child labor offenses are far more severe than those for other types of labor law violations. The FLSA also outlines the requirements for hiring minors. The guidelines limit the working hours for minors and specify hazardous and forbidden activities.
DOL's Wage and Hour Division is in charge of enforcing child labor laws. Civil money penalties can go up to $13,227 per minor in the case of willful violations. The highest civil money penalty is $60,115 if the violation causes severe harm or causes the death of the employee.
Employers who persistently disobey the law face a monetary penalty to the tune of $120,230 in addition to possible imprisonment.
3. On discrimination- Violation of anti-discrimination legislation has severe consequences. In the case of an employer being proven guilty, he/she would have to compensate the aggrieved worker with remedies, such as punitive and compensatory damages. The maximum damages to be provided according to the size of the organization are provided hereunder-
Businesses with 15-100 employees- $50,000
Businesses with 101-200 employees- $100,000
Businesses with 201-500 employees- $200,000
Businesses with more than 500 employees- $300,000
4. On safety- OSH Act inspections are triggered by employee complaints. The investigator will visit the business site and thoroughly inspect the company premises for any labor law violations whatsoever, not just the particular employee complaint.
Serious infractions can result in a penalty of at least $975, and up to $13,653 per violation. The highest fine is the same for 'other-than-serious-violations', but there is no specified minimum fine. You might be fined up to $136,532 per incident if you deliberately repeat the infraction. If there is an issue at the organization and the business owner does not address the issue, he/she would have to pay $13,653 daily until the problem is resolved.
5. On federally mandated leaves- Employee complaints lead to investigations. The investigator would check the employer's FMLA records. If the employer had merely failed to publish workplace information on the rights of the employees under FMLA, he/she would have to pay $178.
However, if the investigator finds that the employer unlawfully terminated a worker based on FMLA norms, the Equal Employment Opportunity Commission (EEOC) may order him/her to repay the employee's wages plus interest and reinstate him/her.
6. On record-keeping- An organization must keep certain documents for each candidate it hires for three years since the date the hiring took place, or one year after the end of employment, whichever comes later. If organizations are found in audits to violate rules on record-keeping, they would be fined.
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